Airports get creative to offset airline cuts

PRINCIPATO (Leslie E. Kossoff for The Boston Globe)

Airlines have been making headlines as unprecedented oil prices prompt them to whittle down flight schedules, levy new fees on checked luggage, and just about everything else. And as airlines fly fewer planes and bring fewer passengers into airport terminal shops, food courts, and parking lots, airports risk losing revenue needed to run and improve their facilities. That was one of the concerns weighing on some of the estimated 2,000 airport executives and business partners from around the world who gathered in Boston last week for the Airports Council International's annual conference. Greg Principato, president of the trade organization's North American division, spoke with Boston Globe reporter Nicole C. Wong about the affect of airline cutbacks, airport revenue-generating tactics, and airport security.

Airlines are unleashing their seat-capacity cuts this fall. How is that affecting US airports? Airports large and small are feeling the brunt. The smaller ones to a greater degree, proportionally. The leisure destinations are having a much tougher time. Whether it's a smaller place or a bigger place, like Las Vegas or Orlando, they're seeing reductions. The number one thing the company wants to know when they make a decision is what kind of transportation network you have. They care about that more than taxes or anything else. Having transportation of all kinds, not just air, is very important.

What happens to these airports that are losing some air service? You may end up losing passengers. The airport is liable to lose revenue that comes from landing fees or any other fees airlines pay, or parking and concessions that passengers may pay. It leaves fewer resources to deal with the fact that airport energy costs are going up, too. You still have to secure the perimeter of the airport. You still have to secure the airfield. It doesn't matter if you've experienced a significant cut in your operations or not, you still have to do those things.

What are airports doing to deal with seat capacity cuts and potential drops in revenue? They're working very closely with the airlines. They're looking for ways to work with them to reduce costs, to make airline operations at the airport more efficient, which also has a cost reduction for the airlines. They're looking for other revenue sources, whether it's new concession opportunities or real estate development. They're looking at nonaeronautical revenue to make up the difference. Airports and their communities are doing what they can to attract new service and retain what they have.

What new things are airports doing to attract air service? Some of it is marketing assistance. Some of it is airports are redoubling their efforts to provide data to the airlines to show they have a market that can support either the current service or a new service.

Detroit Metropolitan Wayne County Airport is selling naming rights and sponsorship for its new North Terminal. That's the first airport to do so, right? What do you think of that? I know airports are looking at things like naming rights and those kinds of things. It's really up to the community and the airport whether they want to do something like that.

The most frequent complaints I hear from travelers are about airport security. What do you think of the state of airport security? It happens at the airport, but security is run by the Transportation Security Administration. I think the current TSA leadership has done a good job at improving its operations and introducing some flexibility. Each airport is very different, just because of the way the airport is built. You can't have a one-size fits all approach to this that's mandated by Washington. Security is an issue that - when I have conversations with airport directors - is the one that comes up more than ever. Security probably came up three-quarters of the time when I talked to an airport director.

What have airport directors told you about security? One of the concerns they always have is when the security setup at a particular airport maybe isn't as efficient as it could be. You worry about the long lines. That obviously creates a less-secure environment when you have long lines of people just standing around.

What other changes are you seeing in airports this year? With all the delays and congestion, we have to do more in the customer service area. The airlines used to take care of a lot of that and increasingly they're not. Airport staff has had to really rush in and fill the breach there. We're seeing a big push not only in the food concessions area, but in other areas like massages, getting your fingernails done, and even looking at pet hotels and those kinds of things.

What unique things are airports doing to take care of passengers? Airports that can afford to do it have brought buses to get passengers off planes if need be. Once a plane pushes back, the airport really has nothing to do with the plane. If a plane has been on the tarmac for four hours, it's not like the airport director can storm the plane with lots and lots of pizzas. I've heard of situations where you've got people stuck out there, they want to get them off the plane, how do we bring them in? Because maybe the gates aren't there, they'll roll the stairs out and take buses - employee lot buses or parking lot buses. They've been more nimble and flexible.